Three Problems with the GOP's Case Against Extending Unemployment Benefits

House Republicans return to Washington being asked to stand together — not in support of an agenda but in opposition to the Democrats' plan on unemployment. A memo released by party leadership shows how shaky that ground is.

House Republicans return to Washington being asked to stand together — not in support of an agenda but in opposition to the Democrats' plan on unemployment. A memo released by party leadership shows how shaky that ground is.

It's a different Washington, D.C. than the one they left in December — a Washington where they're on defense, struggling to define (and then sell) strategies for helping the 1.3 million people who lost unemployment benefits in December. The Democrats have made restoring those benefits a priority — successfully. "President Obama has the fight he wants," Politico's Reid Epstein writes, and it's hard to disagree. The seesaw 113th Congress first saw Democrats giddy over the Republicans' stumbling shutdown, then the Republicans dancing around the rubble of Healthcare.gov. Now the pendulum is swinging back toward the Democrats, who successfully (and surprisingly) cajoled six Republicans into allowing consideration of benefits for the long-term unemployed to move forward — a big victory that Obama wasted no time in trying to leverage.

On Wednesday morning, one of the first orders of business for House Republicans was a party caucus, at which, according to The Washington Post's Robert Costa, unemployment benefits would be a topic. Costa indicates that the party doesn't feel urgency on the issue of restoring the unemployment benefits, in part because that proposal is still making its way through the Senate.

But that didn't prevent the House Republican leadership from distributing a memo with suggested talking points on the topic. The memo, obtained by Costa offers both a frame for the Republican argument and responses to data points used by advocates of extending the benefits. Of the two, the framing seems to have the most traction so far. The Republican argument that any extension of benefits for those long-term unemployed must be offset by cuts in spending elsewhere has at least been considered as a possibility by Senate Majority Leader Harry Reid, according to The Hill.

The data points though? Less robust. Taken in order:

"The unemployment rate is lower today than it was when 'emergency' benefits were allowed to expire in the early 1980s."

This is true. The Republican leaders, citing a White House report that argues that the unemployment rate is higher than in March 1985, when similar benefits were allowed to expire, point out that it isn't. In part, that's because the White House used October's unemployment figure — 7.3 percent, the most recent then available — and not the subsequently-released November number — 7.0. In March 1985, unemployment was at 7.2 percent.

But the more relevant figure to the debate, highlighted by Democrats and even some conservatives, is the percentage of the population that has been out of work for 27 weeks or more. Using data from the Federal Reserve, we calculated that percentage and compared it to the unemployment rate. In March 1985, the overall unemployment rate was higher — but the percentage of the workforce that had been out of work for an extended period was much, much lower.

The vertical yellow line marks March 1985. The top red line is the unemployment rate; the bottom blue line, the percentage of the workforce that's been unemployed for 26 weeks or more. The two green lines intersect the red and blue lines at the March 1985 mark.

"Extending the program will lead to some workers reducing the intensity of their job search and staying unemployed longer."

This argument is based on a report from the Congressional Budget Office, which isn't identified by the Post. This February 2012 report makes that claim, in a broader context.

[I]n order to remain eligible for unemployment benefits, more people without jobs have continued looking for work—though, in some cases, less intensely and more selectively than they otherwise would have—after the normal 26-week benefit period; in that way, the extensions of benefits have kept more jobless individuals in the labor force, thereby pushing up the unemployment rate by roughly one-quarter of one percentage point, CBO estimates.

There are two important points worth pulling out of that, but both relate to the GOP's next argument.

"North Carolina has seen it's unemployment rate fall a full percentage point and a half" since ending long-term unemployment benefits in July.

This is also true. But, as we've noted, that's likely due more to the fact that people are dropping out of the labor force than that they're suddenly inspired to find jobs. And, according to an analyst from the not-notoriously-liberal firm of JPMorgan, people who are taking jobs are often taking them for far less money than they earned previously. That's the CBO's "more selectively" point; people are trying to earn salaries closer to what they had in the workforce previously.

But the CBO's point about how the long-term unemployed are "pushing up the unemployment rate" is salient, too. If people stop looking for work — and the long-term unemployed tend to be older than those who've recently lost jobs — they make the labor pool smaller. So even if no one got a new job, the unemployment rate would drop. That's not a great solution for either party.

The Republicans don't have a unified plan on poverty yet, though Florida Sen. Marco Rubio and House Majority Leader Eric Cantor will both give speeches on Wednesday offering their visions for one. If House Republicans have to rely only on these talking points until an agenda is drafted, the already unfavorable terrain they occupy isn't going to be much more stable.

This article is from the archive of our partner The Wire.

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